A Favorable Fixed Overhead Volume Variance for a Manufacturing Company

question 86

Multiple Choice

A favorable fixed overhead volume variance for a manufacturing company could indicate

• A) the creation of excess inventory.
• B) the actual overhead exceeded the budgeted overhead.
• C) sales exceeded production.
• D) variable overhead costs were less than fixed overhead costs.

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Definitions:

Price Decreases

A strategy of reducing the cost of goods or services, often used to boost sales volume or clear inventory.

NAICS

The North American Industry Classification System, a standard used by federal statistical agencies for classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy.

Buying Center

A group of individuals within an organization who are involved in making purchasing decisions.

Type Of Business

Refers to the classification of a business based on its activities, ownership structure, or scale of operations.